1-1  By:  Sibley                                            S.B. No. 551
    1-2        (In the Senate - Filed March 2, 1993; March 3, 1993, read
    1-3  first time and referred to Committee on State Affairs;
    1-4  March 8, 1993, reported favorably, as amended, by the following
    1-5  vote:  Yeas 12, Nays 0; March 8, 1993, sent to printer.)
    1-6                            COMMITTEE VOTE
    1-7                          Yea     Nay      PNV      Absent 
    1-8        Harris of Dallas   x                               
    1-9        Rosson             x                               
   1-10        Carriker           x                               
   1-11        Henderson          x                               
   1-12        Leedom             x                               
   1-13        Lucio              x                               
   1-14        Luna               x                               
   1-15        Nelson             x                               
   1-16        Patterson          x                               
   1-17        Shelley            x                               
   1-18        Sibley             x                               
   1-19        West               x                               
   1-20        Whitmire                                      x    
   1-21  COMMITTEE AMENDMENT NO. 1                               By:  Sibley
   1-22        Amend S.B. No. 551 by deleting Section (1)(B) of Article
   1-23  1.13, page 1, lines 45-48, and substituting the following:
   1-24        (B)  secured by a pledge of or represent an undivided
   1-25  ownership interest in one or more financial assets, either fixed or
   1-26  revolving, that by their terms convert into cash within a finite
   1-27  time period plus any rights or other assets designed to assure the
   1-28  servicing or timely distribution of proceeds or security holders;
   1-29  and
   1-30                         A BILL TO BE ENTITLED
   1-31                                AN ACT
   1-32  relating to excluding certain sums related to asset-backed
   1-33  securities from the definition of interest.
   1-34        BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
   1-35        SECTION 1.  Subtitle 1, Title 79, Revised Statutes (Article
   1-36  5069-1.01 et seq., Vernon's Texas Civil Statutes), is amended by
   1-37  adding Article 1.13 to read as follows:
   1-38        Art. 1.13.  CERTAIN SUMS EXCLUDED FROM DEFINITION OF INTEREST
   1-39  WITH RESPECT TO ASSET-BACKED SECURITIES.  (a)  In this article:
   1-40              (1)  "Asset-backed securities" means debt obligations
   1-41  or certificates of beneficial ownership that are:
   1-42                    (A)  part of a single issue or single series of
   1-43  securities aggregating $1,000,000 or more issuable in one or more
   1-44  classes;
   1-45                    (B)  secured by a pledge of or represent an
   1-46  undivided ownership interest in a pool of assets, including loans,
   1-47  leases, insurance premiums, and credit card or other types of
   1-48  receivables; and
   1-49                    (C)  issued by a pass-through entity for a
   1-50  business, commercial, agricultural, investment, or similar purpose.
   1-51              (2)  "Pass-through entity" means a corporation, limited
   1-52  liability company, association, general partnership, registered
   1-53  limited liability partnership, limited partnership or business,
   1-54  grantor or common-law trust under state law, or segregated pool of
   1-55  assets under federal tax law that, on the date of original issuance
   1-56  of asset-backed securities, does not have significant assets other
   1-57  than:
   1-58                    (A)  assets pledged to or held for the benefit of
   1-59  holders of the asset-backed securities; or
   1-60                    (B)  assets pledged to or held for the benefit of
   1-61  holders of other asset-backed securities issued on an earlier date.
   1-62        (b)  Notwithstanding Article 1.01 of this subtitle, for
   1-63  purposes of this title the term "interest" excludes any sums paid
   1-64  or passed through, obligated to be paid or to be passed through, or
   1-65  not paid as a result of a discounted sale price to the holders of
   1-66  asset-backed securities by a pass-through entity, in connection
   1-67  with the original issuance or otherwise, regardless of the
   1-68  denomination of the sums under the terms of the asset-backed
    2-1  securities.  Sums excluded from the definition of interest by this
    2-2  article are not subject to Article 1.04 of this subtitle.
    2-3        (c)  This article does not affect or otherwise apply to
    2-4  conventional interest, as defined by Article 1.01 of this subtitle,
    2-5  paid, charged, or received on the assets pledged to or held for the
    2-6  benefit of the holders of asset-backed securities.
    2-7        SECTION 2.  The importance of this legislation and the
    2-8  crowded condition of the calendars in both houses create an
    2-9  emergency and an imperative public necessity that the
   2-10  constitutional rule requiring bills to be read on three several
   2-11  days in each house be suspended, and this rule is hereby suspended,
   2-12  and that this Act take effect and be in force from and after its
   2-13  passage, and it is so enacted.
   2-14                               * * * * *
   2-15                                                         Austin,
   2-16  Texas
   2-17                                                         March 8, 1993
   2-18  Hon. Bob Bullock
   2-19  President of the Senate
   2-20  Sir:
   2-21  We, your Committee on State Affairs to which was referred S.B. No.
   2-22  551, have had the same under consideration, and I am instructed to
   2-23  report it back to the Senate with the recommendation that it do
   2-24  pass, as amended, and be printed.
   2-25                                                         Harris of
   2-26  Dallas, Chairman
   2-27                               * * * * *
   2-28                               WITNESSES
   2-29                                                  FOR   AGAINST  ON
   2-30  ___________________________________________________________________
   2-31  Name:  Chris Williston                           x
   2-32  Representing:  Ind Bankers Assoc of Tx
   2-33  City:  Austin
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   2-35  Name:  David Barbour                             x
   2-36  Representing:  Campstead Mortgage Corp
   2-37  City:  Dallas
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   2-39  Name:  Robert Bass                                             x
   2-40  Representing:  Campstead Mortgage Corp
   2-41  City:  Austin
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